How public officials can use public spending strategically so it delivers for citizens and businesses
It’s time for a human-centred approach to procurement. One in every three dollars spent by governments is on a contract with a company, and procurement plays a critical role in providing better public services and supporting economies. Better procurement can help lower medicine prices, expand public transportation systems and open opportunities for small businesses.
Yet too often, procurement systems and processes are designed without humans in mind. Government officials struggle to make data-driven decisions and innovate because of a lack of good quality, easy-to-use data, and antiquated policies. Confusing and opaque processes discourage vendors from participating. Communities lack input into how services are designed and don’t have good ways to provide public oversight over contracts. Not only does all of this mean that public procurement is the government’s number one corruption risk, but the public is paying more for lower-quality goods and services, and small businesses are missing out on opportunities.
We at Open Contracting Partnership support teams of reformers around the world who share our vision for more open and transparent public procurement that delivers better results for the public. Thanks to our work with teams through Lift, our impact accelerator, we’ve seen that systemic procurement reform is most effective when it’s designed around the people who engage with it.
Here are three key ways we’ve seen our partners use a human-centred approach to radically improve their procurement systems:
Help government officials understand from whom, and what they are buying
Open, comprehensive, timely procurement data is important for understanding where public money is going and making the smartest purchasing decisions. But right now many government officials around the world are unable to quickly and accurately calculate basic metrics around what they are spending, much less share this information with the public.
For example, in Ecuador, a government-civil society Lift team collaboration transformed the national public procurement system. At the core of the reform, the government started to publish open and timely procurement data. But they also knew that this information needed to be user-friendly for all, so they worked with civil society to make sure the data could be re-used by holding hackathons and creating a strong feedback loop. Thanks to their efforts, from 2019 to 2022 competition in Ecuador’s public procurement system substantially increased. Open procedures increased by 10%, and vendor participation increased by 17%.
Improve the vendor experience
Participating in a public procurement process can be intimidating or confusing. For example, in many U.S. cities, it can be tough for vendors to find and submit bids because of unnecessary paywalls and registration requirements, multiple e-procurement portals and tough-to-navigate websites.
Rethinking public procurement from the perspective of vendors can help. For example, the City of Buenos Aires used existing data and surveys to better understand the profile of the small and women-led and -owned businesses that were participating – and asked them about their main challenges. This approach has not only helped to develop better guidance materials and a virtual course but also to start changing the perception that in public contracting, the same (big) companies always win.
Meanwhile, in Des Moines, Iowa, the city’s Lift team is improving their procurement processes by moving to an e-procurement system, testing out new vendor outreach strategies with plain, easy-to-understand language, and collaborating across city departments to improve systems and processes to make it easier for everyone.
Design services with the people who benefit
Ultimately, public procurement should be about providing better public services. But too often, communities are not involved in the public procurement process until it is too late.
The Lift team in Mexico City made unprecedented efforts to involve the public when they solicited bids for their bike share programme Ecobici, the largest bike share system in Latin America. Thanks to their public engagement strategies, the city’s new bike share technology and design will be more user-friendly, and the open procurement process led to a contract that will expand the service area at approximately half the operating costs of the old service. This procurement was so successful that other departments have begun replicating Ecobici’s vendor engagement strategies for major projects.
Moldova has some of the highest rates of HIV and tuberculosis in Europe but the medicines used to treat these conditions are often very expensive, or unavailable. Opaque procurement processes had been used to keep competition out and prices high. In response, Moldovans from some of the most vulnerable groups in society at patient-run organisation, Positive Initiative, came together with open-minded public health and procurement experts through the Lift programme to lead reforms to drive down the cost of drugs without compromising on quality; freeing up funds for other critical preventive and curative care measures. Now the public can monitor US$60 million worth of medical contracts and medicine supply and delivery to hospitals in real-time. This led to savings of 15.4% on medical procurement overall – including 19% saving on HIV medicines.
Getting support through Lift
Starting with people and their needs is a powerful way to tackle a systemic challenge like procurement reform. We asked reformers with ideas for transforming a procurement process or a particular challenge they would like to solve to share with us for a chance to be part of the next cohort of Lift. Applications are now closed and in the coming months, select teams will get up to 200 hours of technical assistance and up to $35,000 of financial support for their projects. Stay tuned.
This article was written by Kaye Sklar, our Senior Program Manager for Lift, and originally posted in Apolitical.